Archive for December 2011

To Iran or Not To Iran

December 31, 2011

It is that time of the year.  Specifically, it is not just any year, but an election year.  Politicians proudly stand and say what ever they think their base would like to year.  Talking tough sells very well.  Leaders, I am told, are suppose to act tough.

The GOP Presidential candidates have thrown their dice on the subject of what to do about Iran’s potential nuclear capability.  All but one has come down squarely on the side of tough action, like bombing Iran’s nuclear facilities.  That’s politics.

There is one notable exception.  Ron Paul.   His libertarian message of “imminent” threat is a wise and prudent position for US foreign policy.  It just does not sell on the campaign trail as well these days.

Think back to 2002 when George W Bush told us Iraq possessed weapons of mass destruction and could pose a threat to America.  He order Iraq to renounce WMD, open their boarders to inspectors, and destroy their current weapons and programs.  This was a difficult order to follow since Iraq did not have either WMD weapons or programs to develop.  Iraq simply saying “no, we have no WMD” was not enough to change the minds of the Chaney-ites.

A trillion dollars and over 4000 US dead later, one might think Ron Paul’s words would receive a fuller review.  They are just not tough enough.  But they are Presidential because the world is not as simple as the other GOP candidates suggest.

After bombing Iran, would the US move onto North Korea and then maybe Pakistan?

Thankfully not on Ron Paul’s watch.

Hard To Understand

December 30, 2011

At last, the first step towards the 2012 Presidential election will take place in a few days in Iowa.  There, Republicans will face off in state-wide caucuses.  Listening to radio interviews of prospective caucus attendees, I heard the answer to “how to make America great again”.  The first step these Iowans say is to defeat President Obama.

He is a socialist, Iowans say of the President.  I guess that is bad.

I am not sure they know what a socialist is, but they are quite sure it is the President.  You know, the President championed a healthcare reform that closed the donut hole for elderly prescription cost, made it illegal for any health care insurer to deny coverage for pre-existing conditions, and found ways to include millions of other Americans in health care coverage.  I guess this means that being a socialist means you have concern for your fellow American.

Oh, and the Obama Administration continued the Wall Street bail out which conservatives soundly berated.  And the President pushed for the Dodd-Frank bill to put sensible limits on the too big to fail banks.  Repeal of Dodd-Frank ranks high among the Iowan GOP voters.  I guess that means a socialist is someone who tries to fix things when they go terribly wrong throwing the economy into a ditch.

And, lets not forget the government loans to GM and Chrysler.  Iowans don’t believe that the government should bail out private businesses.  Farm subsidies might be ok but not making cars.  I guess a socialist is someone who uses the economic power of the Federal government to save jobs and protect important industries in severe economic times, and then make sure they are fully returned to the private sector.

Lastly, the Iowan social issues voters know President Obama is a socialist because he supports all sorts of government activity which is anti-religion.  Proof is everywhere.  Don’t ask, don’t tell was repealed.  The government has stopped defending DOMA and has insisted that same sex couples should be able to adopt children.  I guess a socialist is someone who treats all citizens as equal and does not allow any group, religious or not, to set up special rules to deny certain citizens government provided services.

It is hard to understand this definition of a socialist since it seems so noble.  It is also hard to understand because what I learned from books describes quite different behavior.  Maybe I just don’t understand, and the Iowans have got it right.

Getting Smart In 2012

December 28, 2011

It seems to be one of the GOP’s favorite “get the crowd excited” lines.  “If elected President, I will abolish the Department of Education”.  The approximately $70 billion annual department budget is the whipping boy for many but why?

First, let’s put the $70 billion into perspective.  The nation (the 50 States and their local school districts) spend about $900 billion on K-12 education.   (The US spends almost $900 billion on just Defense !) The K-12 spending translates into about $7,000 per student.  Compared to the rest of the world, the US spends the most and the most per capita.  Do you sense a pattern?  Just like with health care delivery, the US spends the most but does not offer the best educational system in the world.

Add on to this, the approximate $28,000 per year per student for public universities and $41,000 for private ones, this adds up to a lot of money being spent on educations.

So why do many GOP candidates want to dismantle the Department of Education?

There are the usual suspects.  Government gets in the way.  Education is the provence of States. Department of Education is just wasteful spending.  States don’t need Federal help.  And so on.

The GOP may be on to something.  The need, however, is not to abolish the Department of Education but to change its focus and increase its authority.  The 50 States have not produced one clearly superior model acting independently.  Let’s consider.

We need to educate Americans to do something.  Most all place of education whether K-15 or university, public or private, would angrily claim they already provide proper education to anyone attending their institution.  Unfortunately, the outcome evidence points otherwise.  Millions graduate each year and cannot find employment or too many can only find work for which they are over qualified.  This translates into income that will not pay back the cost to educate or provide a route to the American dream.  A losing proposition.

The currently K-12 under educated and under skilled.  High school drop out rates in economically challenged areas currently can reach 50%.  This is a disaster waiting to happen.  Without a high school degree (and a good education to go with it), how can a person navigate the modern world?

The “trade-less” high school graduate.  With no particular skill, a person with a high school degree is destined to low wage employment.

The college drop out.  This class of misguided or underachievers selected the wrong school or the wrong study direction or both.  Their futures could be brighter were there affordable night schools or other full time institutions which could be develop their talents.  (To be sure Steve Jobs and Bill Gates are exceptions.)

The college graduate with a useless degree.  This category includes graduates who truly have not learned much or others who have degrees that are not in demand in the economy.  While learning to think and learning new skills is commendable, being able to support oneself is really necessary.

I doubt that Democrats have much of a better idea but they are not rallying to eliminate the Department of Education.  We need to hear a rally for raising the education output for everyone from the money we spend already on education.

The GOP would do everyone a favor that in place of trashing education or making equally insufficient recommendations like vouchers, they would propose a comprehensive plan that could stand on its own.  Once that plan were accepted, then the redundancy of a Department of Education could be dealt with.

Getting smart in 2012 can’t come soon enough.

My Friend Across The Aisle

December 26, 2011

The last week of the year is usually very quiet.  Many have the time off from work, while others go into their offices and hide.  Congress is in recess making the Washington air is clear of hypocrisy and verbal abuse.

Forgetting for a moment any religious connection to Christmas (not hard to do with all the commercial aspects), the seasonal music, especially the great classics, stir the soul, even of a hardened politician.  Listening to Handel’s Messiah Hallelujah Chorus raises the spirits and gives the feeling of hope.  Why can’t 2012 be a different year?

Thinking back over the angry 2011 political dialogue, one is stuck to assign any substance to anything anyone said.  Consider the great fight the friends across the aisle had over raising the debt limit and how there must be deep cuts in government spending… well actually not all government spending, just certain programs.  In addition, the fight never needed to take place since Simpson-Bowles had already laid out a path to serious debt reduction.  But fight there was.

Consider the last fight over extending the payroll tax cuts.  Putting in place a surtax on those earning more than $1 million were fighting words since this tax would be on “job creators”.  The irony is funding the extension would consequently require taxing the middle class or cutting government spending and the jobs that go with it.  So the “job creators” would see less demand and most likely cut jobs.

In the wake of all this political theater, the air was full of “my friend across the aisle… who clearly cannot think straight…”  The truth is that taking the US economy from the steroids of deficit spending to fiscal sanity will require tough and uncomfortable measures.    The “friends across the aisle” know this but their personal wealth and their supporter’s interests are at odds with most of the measures.

When you attend a performance of the Hallelujah Chorus, everyone stands when the chorus begins.  Everyone.  Why can’t Congress forget “their friend across the aisle” and remember the responsibilities to their Country and all its citizens?

It Didn’t Take Long

December 22, 2011

The dust has hardly settled on the departing US soldiers’ tire tracks.  Not too soon, however, for the true nature of Iraq to rear its ugly head.  There is nothing like a nice big suicide bombing to make Allah happy, and to help put a little more oil money in someone’s pocket.

Modernity appears still years away for Iraq’s citizens.  The practice of Sunnis and Shiites to fall back on their religious leaders promises of martyrdom and simply put on an explosive vest and detonate when they have the chance to kill enough others is pure absurdity.  The practice of covering a woman from head to toe in black while the man walks around in normal street clothes may have served a purpose hundreds of years ago.  Today is serves to show the backward thinking of a nation with a lot of money and no common sense.

The Shiite lead Iraqi government has filed murder charges against the highest ranking Sunni member of the Iraq government.  The charges are serious but really, isn’t there other ways to handle?

The accused Sunni Vice President, Tariq al-Hashemi, is no dummy.  He headed immediately for Kurdish territory and said, in effect, catch me if you can.

With a history of militias and now, no US dollars to buy their loyalty, there is a tough road ahead for the Iraqi government.  Strangely, there in lies the answer.

The now famous US surge that broke the back of the insurgency is a myth (as it relates to troop strength).  The key to stabilizing Iraq was the greasing of many Sunni militia leaders’ hands.  And why should it have not worked?

Iraq is a poor country with the potential of great wealth.  Life could be quite nice, if.  The big “if”, of course, is if the wealth was distributed more evenly.  It is not necessary to be spread absolutely even but at least there needs to be the appearance of fairness.  Saddam Hussein didn’t think that was necessary.  Now the new Iraqi government seems to be developing a blind spot too.

I guess I am surprised it took this long.

The Morning After and No Coffee To Smell

December 21, 2011

We are rapidly approaching the end of 2011 and the third year of Barack Obama’s Presidency.  Of those who voted for him in 2008, who would have thought the state of politics and life in general would be the way it is today?  What happened to that “change you can believe in”?

I doubt most people in 2008 imagined how broken the US economy was and how long it would take to correct.  I doubt most people knew how broken the middle class really was in 2008.  I doubt most people, had they know any of this, would have expected both political parties to act so irresponsibly.

Undoubtably the Obama Administration made two serious mistakes.  The first was endorsing the sweet heart deals for Wall Street.  Everyday it seems more of the stink of malfeasance and outright unethical if not illegal behavior begs the question “why did the government not nationalize the banks, straighten them out, jail the ones responsible, and then privatize them”?

The second serious misstep was reforming health care building upon deals with insurance companies, drug companies, and the AMA.  Real reform cannot be made making deals with those responsible for a health care system satisfied with denying coverage arbitrarily, and yet spending more per capita than any other country in the world.

But these mistakes are in a sense technicalities.  Properly regulating banks (and investment firms) as well as satisfactorily reforming the health care system, can still evolve from these starting points.  Obama’s problem is that what has been done so far does not make for a great campaign slogan.

The unstated but widely felt impression of the President is he thinks about a problem from all angles but does not have the will to draw a line in the sand and stick to it.

Ordinarily one would think the Obama’s reelection is a real long shot.   This may be true but there is plenty of signs the alternative to President Obama could be worse.  The GOP nomination process has been anything but flattering to Republicans.  Far worse, however, has been the GOP public performance in Congress.

The GOP which should have been destined for 20 or more years out of leadership following the Bush years, instead has rebounded.  This new lease on life has come with a price.  Just say no to everything Democrats or the President proposes.  Bingo.  Gridlock.

This week House Republicans refused to accept a bi-partisan Senate compromise that would have extended payroll tax cuts and unemployment benefits.  The consequence is that taxes will rise in January and the GOP (including its Presidential candidate) will have all year to explain why.

Passage would have been good for working people and might have added a little insurance to the recovery.  Although the measure voted upon was only a two month extension, serious politicians could have taken that measure and come back in January to hammer out a longer deal.

So, President Obama is not the person we hoped he might be.  At this point, however, he is still the only adult in the room.

Too Big To Fail

December 20, 2011

With the announcement that AT&T was ending its bid to acquire T-Mobile, a small cheer rose for commonsense government policy.  With four major wireless phone carriers, number one buying number four was not good for competition.  Where was that type of thinking when all the major banks acquired other banks?

AT&T, which boasts 2010 annual revenue of $124 billion, had proposed buying much smaller T-Mobile (revenues of $21 billion).  Their justification, it would be good for consumers.  Try again.

Industry experts claim the real reason was to acquire additional band width and at the same time make the services fee schedule more uniform.  Reducing this confusion apparently is good for consumers even if they end up paying more.

In November, Southwest Air announced it would no longer fly from Philadelphia to Pittsburgh.  At the time of the announcement, both Southwest and USAirways charged about $100. for this short flight.  Following the announcement, USAirways raised it fare by $500.  So much for the value of competition.

Of course we have no way of knowing what might have happened if AT&T had been allowed to purchase T-Mobile.  It just challenges credibility to think that AT&T needs to acquire in order to survive.  Why wouldn’t better products and service be enough to grow the company organically?

It is a murky field where we must decide how big is too big.  I think, however, the government got it right this time.

Pandering To A New Level

December 19, 2011

Newt just being Newt.  It is amazing how one can dismiss statements from the leading GOP Presidential candidate by saying, “well that’s just Newt”.  But Newt is far more clever than just mouthing off.  He is after votes.

Over the weekend, Newt announced that if President, he would use Federal Marshals to bring before Congress judges who rendered controversial rulings.  Why?  Well in order to explain why the judge made such a ruling, of course.

Let’s forget for a moment that these judges were appointed by the executive branch once upon a time, or if he was thinking about elected judges, well they were elected by State voters and are separate from the Federal system.  Let’s also forget that the Constitution calls for a clear separation of the branches with intended checks and balances.

Newt could care less.  He is after votes.  If he can marginalize some judges by alluding to their rulings as unacceptable, and play to the prejudices of some voters, all the better.  Newt is not concerned with collateral damage.

The irony of Newt’s threat is that bringing anyone before Congress for judgement is like finding someone who could throw the first stone.

What Will They Do?

December 18, 2011

When successful College or professional sport coaches end their season (or get fired), they often end up doing even better as a TV commentator.  I am wondering what Michele Bachmann, Rick Santorum, and Rick Perry will do when they “retire” by the end of January?

I doubt Mike Huckabee is anxious to share his seat with any of them.  Mike has done surprisingly well as a Fox news reader and commentator.  Appealing to a large and diverse audience has helped tone down Huckabee’s bible thumping rhetoric a bit.

Santorum must be still thinking the VP job might be his.  If he is still in the race on the pretense that his time at the top of the polls might still come, that should be a sign of an automatic disqualify-er for the presidential nomination.

Bachmann is even a sadder case.  She would sink any GOP presidential ticket.  For her, the goods news is she could stop trying to learn facts and revert back to shoot from the hip style.  Fox might very well make a spot for her.

Perry in theory already has a job.  He could disband his team and return to the governor’s chair in Texas.  Except for the Texas citizens, this would be a good deal.  With regards to VP, it is hard to think of a potential ticket where Rick would add strength.  And, frankly his voice drives me to turn off the TV, not just turn down the volume.  Finishing out his term as governor seems more generous than he deserves but that a matter for Texans to decide.

With respect to Paul, Romney, and Gingrich, barring any unknown exposes, they seem in for the long haul.  Paul is very likely to mount a third party run while Romney would find early retirement his best option.  No one would want to listen to him.

Gingrich is the most interesting one.  He would be dynamite on any of the TV networks.  He would need no script (cut that expense) and could speak to any subject, either from the left or the right side.  While it is still hard to imagine Newt getting the nomination, who knows, maybe it will happen.  He will have a job in either case.

Given the mess that things are in, and the totally dysfunctional Congress that the next President will face, it is a fair question to ask, “what will they do”?

The Way Of The Dodo Bird

December 17, 2011

The drums have been beating loudly.  The cries of supporters deafening.  Opponents have bared their teeth.  This was a fight to the finish.

I am speaking of the special millionaires tax.

With hardly a whimper, the discussion has ended.  No death blows were struck by our Congressional gladiators.  No prisoners have been taken or for that matter, released.  It seems political speak has just moved on.

It might be useful to review this episode.  The whole subject arose because there is a new found belief that Congress must pay for what gifts it wishes to bestow.  This being Christmas, gift giving is very popular.  Extending unemployment benefits and granting a 2% reprieve on payroll taxes seemed just what Santa had in mind for the middle class.

But how would these expenditures be paid for?

President Obama suggested a special surtax on the wealthiest of the wealthy.  Dubbed the millionaires tax, those who could afford to pay would cough up less than they would, if and when the Bush tax cuts expire.  They were being asked to pay for these presents.  The economic argument was that these gifts would immediately flow into the general economy providing some economic medicine.

One could argue that a healthier economy will benefit those millionaires more than anyone else.  The millionaires, called “job creators” by the GOP, must own the businesses that the middle class frequent.  It would have seemed a perfect ending.

But it seems the “job creators” wanted the income from their businesses without any additional taxes.  The GOP soldiered on and blocked the payroll tax extension.  This would be a battle to the last man (or woman).

Now suddenly the millionaires tax is off the table.  Other fuzzy payment methods have replaced it.  It looks like business as usual.  These extensions are only worth a couple of $100 billion, so who cares.

The unvarnished truth of this matter is (1) the real value of extending the payroll tax holiday is unknown but assuredly small, and (2) the millionaires would never have felt the new tax and could easily have justified it as an insurance policy.  Why did Congress fight so vigorously over this seemingly small point?

Could it be that this great fight was only about positioning for the 2012 elections?  What is most scary is that Congress might be trying to find a path to the Dodo bird.